India’s gold imports in November declined for the fifth month as elevated prices and the slowest economic growth in six years curbed demand during the peak wedding season.
Inbound shipments dropped 19% from a year earlier to 56.1 tons, according to a person familiar with the data, who declined to be named as the information isn’t public. That makes it the lowest shipment for the month since at least 2015, data compiled by Bloomberg shows.
Total overseas purchases slid 15% from year earlier to 597.5 tons during the 11 months through November, the person said. Finance Ministry spokesman Rajesh Malhotra wasn’t immediately available for comment.
Imports in the world’s second-biggest consumer have been falling as jewelers have been cutting purchases on poor demand. Slowing growth and a more than 20% rally in prices this year are expected to push India’s domestic consumption to the weakest since 2016. A delayed monsoon and harvest have also weighed on demand in rural India, which accounts for about 60% of the nation’s gold purchases.
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The fall in November’s shipments signals “a general slowdown in the economy and lower liquidity among rural population due to late harvesting of crops,” said Harish Galipelli, head of commodity and currencies at Inditrade Derivatives & Commodities. Consumer confidence in India dropped to its lowest since at least 2014, the central bank’s consumer confidence survey showed earlier Friday.
Still, an uptick in demand driven by the wedding season pushed up November’s imports above the 20.8 tons shipped in October and September’s 13.5 tons. Indians buy gold mainly to wear or gift during weddings and festivals, with the peak purchases typically taking place during the last quarter of the year.
“Imports will slide again in December as there are no auspicious days for weddings from Dec.15-Jan. 14,” said Gnanasekar Thiagarajan, director at Commtrendz Risk Management Services. “Gold prices will also continue to trade higher bolstered by huge uncertainties in the global market on the trade deal between U.S. and China, U.S. interest rates, peaking stock markets, and the U.S. elections.”